UK – Management could follow administrative workers into redundancy under government plans to outsource the NHS Pensions Agency’s remaining functions next year.

The NHSPA administers pensions for the UK’s National Health Service.

A consortium led by Paymaster won the outsourcing contract to run around half of the agency’s functions in 2003, with an option on any future outsourcing. More than 30 companies and consortia responded to the original government tender to take over mainly administrative functions at the agency.

Health minister Jane Kennedy seemed uncertain earlier this month in response to a parliamentary question about plans to outsource the remainder.

She said: “Should a decision be made to expand the existing outsourcing arrangements at the NHS Pensions Agency, full consultation will be undertaken with both trade unions and employees.” The agency, which oversees the pensions of 1.2m NHS employees, seemed considerably more certain that outsourcing would go ahead.

Under transfer of undertakings (protection of employment) regulations, employees whose jobs transfer to the private sector are guaranteed comparable terms and conditions. What they are not guaranteed is a job. Around 400 employees currently work in the agency’s offices in the Lancashire coastal town of Fleetwood.

Asked about likely job cuts, a source at the agency said: “Even in the public sector, is any job guaranteed? It’s a hypothetical question.”

PCS, the union representing many of those whose jobs are threatened, was slightly less philosophical. A postal ballot – the results of which are due in January – could well end in a strike, according to spokesman Keith Wiley. But he added that the union would continue negotiating with the government.

“Two centres have already closed. They claim it hasn’t had a negative impact on service delivery but we’re hearing a different story,” he said.

Although the NHS Pensions Agency source said the decision to outsource was “not an exercise in redundancies”, the Department of Health is under pressure to cut payroll costs by 2008.

Privatisation of the remaining functions coincides with a structural reorganisation. The agency will next April be subsumed with other NHS functions in the Business Services Authority.

Paymaster was unavailable for comment.